Rowan Street Capital LLC, an investment management firm, published its second-quarter 2022 investor letter – a copy of which can be downloaded here. Over many years, the fund concluded that its sole focus should be on identifying and partnering with visionary CEOs and the best entrepreneurs in the world, preferably in the earlier-to-mid stages of their careers. Rowan Street Capital believes in playing the long-term game with long-term people. Go over the fund’s top 5 positions to have a glimpse of its finest picks for 2022.
In its Q2 2022 investor letter, Rowan Street mentioned Shopify Inc. (NYSE:SHOP) and explained its insights for the company. Founded in 2006, Shopify Inc. (NYSE:SHOP) is an Ottawa, Canada-based multinational e-commerce company with a $50.9 billion market capitalization. Shopify Inc. (NYSE:SHOP) delivered a -70.67% return since the beginning of the year, while its 12-month returns are down by -74.66%. The stock closed at $40.40 per share on July 21, 2022.
Here is what Rowan Street has to say about Shopify Inc. (NYSE:SHOP) in its Q2 2022 investor letter:
“Tobias Lutke, Shopify (NYSE:SHOP) Founder and CEO
When Tobias Lütke opened an online snowboarding store in 2004, he realized how painfully cumbersome e-commerce software was. So he decided to create Shopify – a platform that made it easy for anyone to open up an online store.
Tobi has built Shopify into one of the most popular e-commerce platforms in the world, with $175 billion in GMV (Gross Merchandise Value) and $4.6 billion in revenues in 2021. SHOP went public in 2015, when revenues were just lightly above $200 million, and the stock is up 1,233% since its IPO. Shopify stock peaked in November 2021 (traded at astronomical 47x sales), which coincided with peak enthusiasm for the tech-driven, “stay-home” stocks. Since then, the stock is down almost 80% and is currently trading at just 6x 2023E sales. We believe that Mr. Market is offering us an exceptional value, at current price levels, for an exceptional company led by a very talented, visionary founder/CEO.”
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Our calculations show that Shopify Inc. (NYSE:SHOP) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Shopify Inc. (NYSE:SHOP) was in 72 hedge fund portfolios at the end of the second quarter of 2022, compared to 86 funds in the previous quarter. Shopify Inc. (NYSE:SHOP) delivered a -16.01% return in the past 3 months.
In June 2022, we also shared another hedge fund’s views on Shopify Inc. (NYSE:SHOP) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.
Disclosure: None. This article is originally published at Insider Monkey.
